From Dead Right (Richard Denniss, 2019) pp143-6
Is cracking down on corruption a progressive or a conservative thing to do? While it seems consistent with the pursuit of “law and order” in so much of the Coalition’s policies and political messaging, the creation of a corruption watchdog with broad powers appears to be a bridge too far.
Given neoliberalism’s hatred of wasteful spending, it would be reasonable to assume that the Coalition, a party previously defined by its pursuit of small government, would see the creation of a federal anti-corruption body as a good way to ensure that policy was always in the national interest and never tilted off-course by graft, kickbacks or old boys’ clubs. But despite every state having a dedicated watchdog, and the fact that the ALP, the Greens, most of the crossbench, a large number of judges and most of the public are calling for one, the federal Coalition remained implacably opposed . . . until it lost its majority in the House of Representatives after the Wentworth by-election.
Remarkably, one of its central arguments had been that here were already thirteen agencies with a role to play in detecting and preventing misconduct. The existence of so many regulatory bodies is, of course, neither proof that no corruption exists nor that reform and simplification are not required. Further, while the existence of so many agencies with a partial corruption-fighting role might, to an advocate of small government, seem like an opportunity to streamline the system, the Abbott, Turnbull and Morrison governments have all used this sprawling bureaucratic network as a justification for inaction rather than reform.
And then there’s the economy. Corruption is widely believed by economists, lawyers and business leaders around the world to be “bad for the economy.” According to the International Monetary Fund (IMF), not usually known for its support for government intervention, “Tackling corruption is vital for sustaining economic stability, promoting inclusive growth, and maintaining security in society and certainty in the market.” Similarly, the well-known leftists at the World Bank have argued, “Corruption impedes investment, with consequent effects on growth and jobs. Countries capable of confronting corruption use their human and financial resources more efficiently, attract more investment, and grow more rapidly.” Yet, despite the centrality of “jobs and growth” to the Coalition’s agenda, and its willingness to spend tens of billions on company tax cuts to attract foreign investment, it has shown little interest in heeding the advice of some of the most pro free-market and free-trade advisers in the world.
Corruption is a big problem in Australia. In recent decades, companies owned by the Reserve Bank have been involved in bribing foreign officials, as have staff at the Australian Wheat Board, and a deputy commissioner of the Australian Tax Office was charged in relation to a $130 million fraud. Federal politicians, their staff and senior federal public servants often find lucrative jobs as lobbyists after they cease their period of “public service]; and indeed some politicians like the former minister for small business Bruce Billson have even started this work before leaving parliament. Obviously not all those who move from public service to private lobbying are corrupt, but it is clear that the private sector believes that the ability to help a company navigate the decision-making processes of a political party is worth millions of dollars. If these processes were transparent and in the national interest, the ability to open doors would not be valued so highly by the private sector.
In neoclassical economic theory often favoured by neoliberal politicians the most profitable industries have the biggest “barriers to entry,” and the least profitable businesses face lots of competition from new entrants. But the BRW “Rich List” and the Australian Stock Exchange tell us that the best ways to make a fortune in Australia include property development, mining and the provision of financial services. Intriguingly, all of these industries rely heavily on the discretionary powers of politicians and public servants. The ability to get land re-zoned or a mine approved is one of the most valuable “skills” in Australia. And as the banking royal commission has shown, the reluctance of financial regulators to prevent fraud and theft has played a significant role in the enormous profits earned by Australian financial institutions. Indeed, revelations at the royal commission led to a reduction in the share market valuation of AMP of more than 40 per cent. Put another way, investors no longer believe that AMP will be as capable of charging the dead, disadvantaged or illiterate the exorbitant fees it did before the royal commission, and in turn they now believe AMP will make a lot less money. Why the royal commission was able to uncover crime and misconduct but ASIC and APRA weren’t could be an interesting question for a federal corruption watchdog to answer.
Significantly, many of those who are adamant that no federal corruption watchdog is needed vehemently argued that a royal commission into the banking and Financial services sector was unnecessary.
Tgk1946's Blog 